The Iowa-Nebraska Equipment Dealers Association (INEDA) is fortunate to have two field directors on the road visiting dealers and distributors. One of their roles is to listen to members’ needs and concerns and provide immediate solutions. One of the main issues facing members today is hiring and retaining employees, so we sat down with our field directors to find out what they’re hearing from dealers on the topic.
Mark Othmer, Nebraska Field Director, firstname.lastname@example.org
Tom Junge, Iowa Field Director, email@example.com
What unique employee retention tool(s) have you seen being used by dealers?
Mark: Some dealers will purchase life insurance policies on key employees and agree to sign it over to them after an agreed-upon time of employment.
These could be term policies with cash values that the employee can choose to cash out or keep in place.
Tom: I heard of one situation where a 55-year-old key employee was considering leaving. The dealer and employee came up with a 10-year agreement where he would put $3,000 into a fund and write the employee a check for $30,000 at the end of the period. The employee immediately thought about how he and his wife could use the money for traveling.
How have dealers worked with guidance counselors and educators to recruit new young employees?
Mark: Dealers have luck working with FFA organizations and sponsoring agriculture and industrial arts teachers. More of these educators are understanding the opportunities for students in the trades than we’ve historically seen.
Tom: One dealer got their local school district on board by sharing the importance of keeping students employed in the local community after graduation. If the school sends all of their students away to a four-year university, there won’t be any young people left to sustain the community and the school district.
Where else have you seen success in dealership employee recruitment?
Tom: One thing successful dealerships have in common is that they have implemented a grassroots effort to recruit new employees from within their community. They have open communication with high schools and identify students early. If the student wants to be a technician, they help sponsor them in a tech program.
The key is recruit locally. A dealer who worked in HR once told me that 90% of people look for jobs based on proximity of their hometown. They may leave for a while, but they eventually end up back near their hometown or spouse’s hometown. Their dealership wouldn’t recruit anyone whose hometown was more than 50 miles from their business.
It seems that more employees don’t want to work Saturdays. Are dealers changing their work week?
Mark: Dealers are identifying the times in spring and fall (usually four weeks each) when they need to be open on Saturdays—and sometimes even on Sundays—and then closing on weekends for the rest of the year. Other dealers will rotate Fridays off for the employee who is responsible for working on Saturday.
Dealers need to talk with their employees, express the need for being open on weekends, and listen to what employees want in exchange. Usually they can reach an agreement.
Tom: More and more dealers are closing on Saturdays during the off-season. Before making these decisions, they reviewed tech billing and parts sales to see if the decision made sense.
Others are keeping one staff member from each department at work on Saturdays during the off-season. A few have cut back their workday by 30 minutes per day. One dealer told me, “I have no problem closing on Saturday, but I don’t want to be the first one, and I don’t want to be the only one.
Dealers tell us that customers are more demanding and want 24/7 customer service, but the workforce only wants a 40-hour week. How should dealers respond?
Mark: Customers are definitely becoming more demanding. Quite often, technicians give their phone numbers to customers which allows customers to call them directly at any time. Because of this, some customers will expect 24/7 service without a charge. This happens a lot, and dealers are struggling with how to control it. Some dealers are negotiating “after hours service contracts” with customers so everyone knows the charges up front and technicians know what they will be paid up front.
Tom: It is a tough problem to tackle. When I worked at a dealership, there were really only two customers that would appear in our driveway on a Sunday. Most farmers would wait till Monday. I’m seeing dealers handling this by implementing an emergency call fee that they split with the tech carrying the service cell phone for the weekend. With this fee, many of the “emergencies” suddenly aren’t as urgent anymore. Some dealers are also communicating to customers that if they don’t back off on weekend hours, they will not have any experienced techs to service their equipment even throughout the week.
What changes are you seeing regarding the structure of the employee work week?
Tom: I just recently talked to a dealer that is experimenting with a four 10-hour workday and rotating staff. Early reports show that some employees like it and others don’t.
Typically, Saturday employee productivity is poor. Dealers want to see if overall production will improve if employees know they only have to work 40 hours a week. Another dealer said he lost an employee to a competitor that allowed him to work four 10 hour days. He was a good employee and considered offering the same but didn’t know how to handle inquiries from other employees. Some are trying to rotate employees on Saturdays, but at peak times, it might still be all hands on deck. For some employees, time off is just as important as wages, so I’ve heard some dealers considering letting employees earn extra PTO (Paid Time Off) that can be taken in the off-season.
Mark: I don’t think limiting employees to 40 hours is necessary, and I actually believe most employees are looking to work more hours in the busy seasons. Rotating staff on Fridays and Saturdays can work, but supervision of employees each day needs to be the same, so service managers will have to rotate on those days also. If there is only one service manager, there needs to be a second in command who rotates with the service manager.